Question : When a partner retires from the firm having three partners, firm will necessary be …….
Option 1: Dissolved
Option 2: Revalued
Option 3: Reconstituted
Option 4: None of the above
Answer (1)
23rd Jan, 2024
Correct Answer: Reconstituted
Solution : Answer = Reconstituted
When a partner retires from a firm with three partners, the firm will necessarily be reconstituted. This involves adjusting the partnership agreement, redistributing ownership and profit-sharing ratios among the remaining partners, and settling the retiring partner's share of the firm's assets and liabilities without dissolving the partnership.
Hence, the correct option is 3.
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